The ways that credit cards can make you unhappy are legion. Fees, balances, crazy interest rates, universal default, the list goes on. But, even though we just saw Bank of America digging a pit in your backyard, and word has it the zoo is missing 3 tigers and a crocodile, there are a few ways that a credit card can make you happy. (Not all of these tips are unique to credit cards, so check to see which benefits your debit card has.)

In order to properly enjoy these tips you have to:

• Enjoy budgeting money.
• Be naturally responsible with money.
• Have a job.
• Spend less than you earn.
• Pay your credit card on time.
• Realize that not all cards are the name, and take the time to find one that has the benefits you want.

If that sounds like you, let’s take a look:

1) Cash Back: Some cards offer “rewards,” but we think those programs are better at convincing you to spend money than they are at actually giving you the rewards. We like cash back cards. You spend money. You get some back. It makes you happy.

2) Insurance: If you credit card offers rental car insurance you can say, “No thank you” to the rental car agent when he or she asks if you’d like to purchase insurance. In fact, you should do this, because accepting the rental car insurance may void your credit card insurance. (Some debit cards may also offer this sort of protection, so don’t assume that yours doesn’t and run out and get a credit card just for this reason.) If your card carries this benefit, don’t forget about it, or you’ll be sad. Your card may also offer roadside assistance without you even knowing about it. Will you remember this when you’re stuck on the side of the road?

3) Arbitrage: Some people really like doing this. Personally, we would screw it up and don’t recommend it, but it is a demonstrable fact that there are people who are benefiting from this tactic. So who are we to judge? It makes them happy. (We still think you shouldn’t do it.)

4) Fraud Protection: It might be due to the differences between how credit and debit fraud is handled, but most of the horror stories we hear are from people dealing with bank account/debit card fraud. Credit card fraud departments seem to have their act together when compared to a bank’s fraud department. This is just an observation, but we do read an awful lot of complaints. Take it for what it’s worth.

5) Extended Warranty Protection: If you buy a lot of expensive electronics, get a credit card with extended warranty protection. If you do this, you’ll be able to say “get lost” to the blue shirt who is trying to sell you an expensive warranty. Don’t believe us? We helped one of our readers get his laptop replaced by AMEX. He sure seemed happy.

We know a lot of our readers use credit cards. Why do you bother with them when so many “personal finance gurus” tell you you’re crazy? Let us know in the comments.

(Photo:jgodsey)

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